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13 December 2012

Minister asks public to 'bring back' state propertiesIol - South Africa
Public Works Minister Thulas Nxesi and Gauteng provincial MECs have committed themselves to reviving a campaign that invites individuals to come forward if they have any knowledge of, or have been involved in, the unlawful transfer of immovable assets belonging to the state, the ministry said.

It said the decision to revive the "Bring Back Campaign" was taken on Friday at a regular meeting of Minmec, which includes Nxesi, his deputy Jeremy Cronin, MECs, senior officials and heads of public built environment entities.

The Department of Public Works has been working on creating a comprehensive and accurate register of state assets since 1994, with little success.

Part of this exercise involves investigating the unlawful transfer of state properties to private individuals, which took place as a result of the absence of a reliable asset register. The department is the custodian and manager of state property.Iol.co.za

Residential Yield DataFNB-TPN - South Africa
Residential property gradually recovering its attractiveness as an investment and 2013 expected to bring more of it?
Although it has not yet regained its shine as an investment, the attractiveness of residential property as an investment does appear to be gradually improving. This is the view of John Loos, Household and Consumer Sector Economist at FNB, and Michelle Dickens, Managing Director of TPN (Tenant Profile Network) Credit Bureau.

“While the average home owner appears to place much emphasis on the value of his or her property, when it comes to property as an investment it is actually the income stream that it generates, relative to the price paid, that should really be the focus”. So, says Dickens, “In investorspeak, a far better number to focus on would arguably be the “initial yield”, i.e. the income expected to be earned over the next year divided by the property value”.

Loos adds that it is therefore somewhat ironic that, when we discuss house price performance in recent years, many see it as a depressing picture. “However, weak house price growth that underperforms rental income growth is actually what is required to improve the attractiveness of property as an investment in future, through leading to a higher yield.”The New FNB_TPN Residential Yield

House Price Indices - November 2012Absa - South AfricaHouse price growth trending upwards
Year-on-year growth in the average value of homes in the middle segment of the South African housing market increased further in November 2012. Month-on-month price growth, however, continues to be on a downward trend, which is expected to affect year-on-year price growth in the near future. These house price trends are according to the Absa house price indices, which are based on applications for mortgage finance received and approved by the bank in respect of small, medium-sized and large homes in the middle segment of the market (see explanatory notes).

Middle-segment home values showed a nominal rise of 5% year-on-year (y/y) in November 2012, after increasing by a revised 3,3% y/y in September. In the first eleven months of the year house prices were unchanged compared with the corresponding period last year, largely impacted by price deflation in the small segment of the market up to August this year.

Real price deflation was still evident in middle-segment housing up to October, but the momentum is slowing down, with the small and medium-sized categories showing some real year-on-year growth in October. Real price calculations are based on nominal prices deflated by the headline consumer price index. Consumer price inflation was 5,6% y/y in October, averaging 5,7% y/y in the first ten months of the year.Absa House Price Indices Nov 2012

RealNet Predictions for 2013RealNet - South Africa
Jan Davel, MD of the RealNet estate agency group,says household finances are likely to remain under severe pressure in 2013, which will limit the ability of prospective buyers to qualify for bonds and become homeowners.

On the one hand, he says, the increased consumer appetite for credit in 2012 has been matched by aggressive lending in the personal loan environment, and many households will be carrying an increased debt load into 2013.

“Then on the other hand, real disposable incomes are likely to shrink due to such factors as Eskom tariff hikes, rising food and fuel prices, higher municipal rates and the introduction of e-tolling.

“So debt ratios that have been declining will, in many cases, go back up again and choke off demand. Many households will simply not be able to qualify for a home loan, despite the fact that interest rates are expected to stay low in 2013.RealNet Predictions

Call for master-plan to save SA from the ‘housing cliff’BetterBond - South Africa
Just as the US needs “all hands on deck” to stop it sailing over the fiscal cliff, so SA needs a multifaceted effort now to solve a housing crisis that threatens to overwhelm the country.

So says Rudi Botha, CEO of South Africa’s biggest mortgage originator BetterBond, who notes that of the 14,5 million households recorded in the latest Census, at least half live in homes they don’t own – some in accommodation provided by their employers, some in rented homes and backyard shacks and shockingly, more than 1,3m in squatter camps.

“No-one has actually quantified how many millions of people this involves but clearly it is a recipe for serious political and economic instability – as evidenced by the increasing number of service delivery protests and strikes that have already so badly affected SA’s productivity levels, credit ratings and economic output this year.”Save SA from housing cliff

Aida National Franchises Predictions for 2013Aida - South Africa
Neville McIntyre, chairman of Aida’s parent company Jigsaw Holdings, says the expectation all over the world, and not just in SA, is that a scarcity of capital will prevail in 2013 and that there will thus be no increase in mortgage lending. “The demand for housing, on the other hand, is set to increase dramatically, and because of that we foresee that there will be a slight increase in the number of property transactions and in the number of new developments coming to the market.Aida predictions

Chas Everitt International predictions for 2013Chas Everitt - South Africa
Berry Everitt, MD of the Chas Everitt International property group, says 2013 will be the year when property developers start making a moderate re-entry into the market.

“There has of course been some development at the lower end of the market for the past few years, because buyers in this sector are often subsidized or able to gain special access to 100% home loans.“However, what I anticipate now is that developers will become increasingly active in the R650 000 to R850 000 price bracket where the banks are lending well, especially on newly-built homes.”

And speaking of banks, he believes they will continue, for most of next year, to keep a lid on the market by valuing properties and lending according to “bank security value”, which does not necessarily coincide with actual “market value”.Chas Everitt Predictions